Slimmer-Than-Expected Q2 Losses Boost Big Lots Stock

Big Lots stock has shed more than 50% in 2022

Digital Content Manager
Aug 30, 2022 at 9:25 AM
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Retail name Big Lots Inc (NYSE:BIG) just entered the earnings confessional with second-quarter losses of $2.91 per share, which was slimmer than analysts expected. Big Lots' revenue of $1.35 billion also topped estimates, however, the firm predicted that its current-quarter comparable sales would fall to the low double-digit range, compared to last year's numbers. In response, BIG is enjoying a pre-market pop, last seen up 3.9% at $22.39. 

The stock has been chopping lower for the better part of the year, with pressure at the 130-day moving average rejecting two of the stock's braver breakout attempts. The 80-day moving average has stepped in as a more immediate rejection level on the charts, and could act as pressure for any additional upside from the equity. Year-to-date, BIG sports a 52.2% deficit. 

Analysts have yet to chime in, but the sentiment surrounding BIG is gloomy. Five of the eight in coverage call the stock a "hold," while the remaining three say "sell" or worse. Plus, the 12-month consensus price target of $21.43 sits at a slight discount to current levels. 

Options traders have taken a more bullish stance. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security sports a 50-day call/put volume ratio of 2.10, which stands higher than 80% of readings from the past 12 months. In other words, long calls are getting picked up at a quicker-than-usual clip right now. 

Echoing this, the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.72 stands in the low 19th percentile of its annual range. This implies short-term options traders are more call-biased than usual. 

 

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